Some recent marketing agreements demonstrate the increased willingness of public and private payments system processors to cooperate in promoting use of the automated clearing house network.

The Federal Reserve Banks of St. Louis, Kansas City, and Chicago formed marketing alliances with Mid-America Payments Exchange, which is based in Kansas City.

And the Federal Reserve Bank of Richmond agreed to join marketing forces with Eastpay Inc., Richmond, Va., and South Carolina Automated Clearing House Association, Irmo, S.C..

Taken with existing promotional campaigns directed by the Federal Reserve banks and the National Automated Clearing House Association, the moves show the industry's renewed commitment to building the ACH.

Automated clearing house volume has grown steadily in recent years, but the payment system still is underutilized, said Kathleen O'Neill Paese, operations and marketing officer at the St. Louis Fed.

"We are really trying to work more cooperatively because we realize we share a common goal," she added. "If we marshal our forces, we can be a lot more powerful."

The Richmond Fed's effort is an example of Ms. O'Neill Paese's wisdom at work.

The Fed bank and its partners are promoting direct payment of bills in conjunction with seven utilities in the South.

The service, called the Carolinas Automatic Payment Plan, is soliciting users through a mailing of 9.8 million consumer enrollment forms.

The forms are being distributed by NationsBank Corp., First Union Corp., First Citizens Bank (Columbia, S.C.), Centura Banks Inc., Wachovia Corp., and Branch Bank and Trust (Winston-Salem, N.C.). The Richmond Fed will act as central processor for the forms.

Customers who agree to participate will receive monthly statements showing the date and dollar amount of the ACH withdrawal. Utilities will not charge customers for the service.

"Automatic bill payment is truly a win-win situation," said Sherry Love, assistant treasurer at Duke Power Co., Charlotte, N.C. "The consumer wins by not having to write checks and buy stamps to mail bills. The utility company wins by reducing costs."

In the other marketing alliance, the three midwestern Feds and Mid- America Payments Exchange will try to convince 100 companies to begin offering employees direct deposit services, and will try to persuade others to expand existing programs.

The marketing efforts, which will cover nine states, could add more than 50 million new ACH payments in the next two years.

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